AFP, Mumbai :
India’s central bank on Wednesday cut interest rates for the fourth time this year, as New Delhi battles sluggish economic growth and high unemployment.
The Reserve Bank of India (RBI) said the benchmark repo rate – the level at which it lends to commercial banks – would be reduced by 35 basis points to 5.40 percent, taking rates to their lowest level since 2010.
“The monetary policy committee was of the view that a 25 basis point rate cut was inadequate due to evolving global economic conditions while a 50 basis point cut would be excessive,” RBI governor Shaktikanta Das told reporters.
“Hence, 35 basis points was viewed as a balanced level of cut due to the current circumstances.” All 36 economists surveyed by Bloomberg News had predicted the central bank would cut rates by 25 basis points. A fall in domestic demand lowered India’s growth rate in the last quarter to 5.8 percent, with unemployment at its highest since the 1970s.
Indian carmakers including Mahindra & Mahindra have halted production and reported falling sales as consumer demand fell throughout 2019.
